It is seen that many people take financial decisions based
on recommendation by their family, friends, colleagues, etc. These are the
people whom we know well and therefore take their advice without thinking too
much. However, these people may not be knowledgeable enough to give you advice
or recommend a financial product.
Investing in a product just because a person recommended it
to you may cause you loss. If you invest in a product based on advice of a
friend or relative you might repent it later. The person giving you advice
might not be fully aware about the pros and cons of the product or the
suitability of the product for your needs. For example, if someone tells you
that they booked lot of profit by investing in a particular stock, it does not
mean that it will be profitable for you too. Investing in stock requires a
proper analysis and good timing before you invest in them.
So if the advice of friends and relatives is not reliable
where should you look for your investment needs? The answer is simple –
Professional financial advisors. Financial advisors have deep understanding of
various financial products such as insurance, mutual funds, stocks, etc. They
know the benefits various instruments offer and also its drawbacks. They are
experts in the field and can help you with savings and investments.
Financial advisors will help you decide where, when and how
much you need to invest based on your current and future financial needs. This
includes a wide range of financial goals such as marriage plans, vacation,
children’s education, retirement, etc. They will systematically plan your
investment taking into consideration your income and expenses. You might not
always understand the complicated matters relating to investment, insurance and
tax savings. Financial advisors with their knowledge and experience make it
simple for you. They will also monitor the progress of your investments to see
if any changes are required in your asset allocation. Your tax related queries
can also be resolved by them. This will save you lot of time and worries. You
do not have to be a big investor to take help of advisors.
People are normally reluctant to seek help of financial
advisors for many reasons. They may think that they can manage their own money
and taking help of professionals will not be worth it. Some might also have
issues regarding trusting some unknown person with their money. Besides, some
may be wary of them charging huge sum for their services. All these issues
should not matter if the advisors are well qualified and if the cost is worth
the services rendered.
